Australia is beefing up its defenses against terrorism and illegal immigration in the government's budget for the coming year. Around half a billion U.S. dollars will be spent on military hardware, a new immigration detention center on remote Christmas Island and new border protection measures.

The Australian Treasurer Peter Costello said his budget has one simple message - to make the country safer. He is pouring hundreds of millions of dollars into defense, police, customs and immigration services. The money will help Australia resist international terrorism, finance the country's military commitments in Afghanistan and East Timor and further the crackdown on illegal immigrants.

The government is aware that parts of the federal budget will be unpopular. Cuts in health and welfare spending have been ordered to pay for this additional ring of steel around Australia.

Mr. Costello told the Australian parliament that the government will not be complacent in the face of a changing, more dangerous world. "Last year, when I delivered the budget we did not know that four months later our world would change in such a devastating way. The terrorist attacks of 11 September shocked us all and showed that terrorism could strike even the most powerful of nations. We cannot take our security for granted. Tonight, I will announce measures to upgrade Australia's security. Tonight, I will announce measures to secure Australia's borders," he said.

Mr. Costello said the Australian economy is outpacing its international competitors. Still, he forecasted a budget deficit of half a billion dollars, caused the spending on the war on terrorism and lower than expected tax receipts. Economic growth is predicted to be above three percent in the coming years.

This budget is in line with the conservative government's election pledges. It promised to stand side by side with the U.S. in its war on global terror and to ensure Australia is not flooded with a wave of asylum seekers trying to enter the country illegally.